A series of fiscal measures with significant consequences were published in Romania recently. TPA Tax experts from Romania have listed the most important changes here.
1. Special provisions for employers and employees working in the construction sector
Between 1 January 2019 and 31 December 2028, the following incentives are to be granted to individuals earning between RON 3,000 and 30,000 based on individual employment contracts concluded with employers working in the construction sector and who generate at least 80% of their turnover from construction activities:
• exemption from personal income tax
• a reduction in social security contributions from 25% to 21.25% as well as the suspension of contributions to the private pension fund
• a reduction in work insurance contributions from 2.25% to 0.34%
• exemption from social security contributions for activities carried out under difficult or special working conditions
• exemption from health insurance contributions by retaining the status of insured employee
New 2019: Minimum Gross wage in the construction sector
A further measure adopted with effects in the construction sector is the introduction of a minimum gross wage of RON 3,000 per month.
2. 2% tax on gaming operators
Online gaming operators are to be required to pay a monthly tax of 2% on participation fees collected during that month (payment deadline: 25th day of the following month).
In addition, gaming operators are to be required to pay an annual contribution of either EUR 1,000 or EUR 5,000 a year, depending on the type of activity carried out.
3. 2% tax on holders of energy licences
Holders of licences in the field of electricity, of electricity and heat energy in cogeneration with electricity and of natural gas are to pay a contribution equal to 2% of the turnover derived from performance of the activities covered by licences granted by the electricity regulator (ANRE).
- More about our services in the field of energy & renewables
4. Tax on financial assets held by banks
Banking institutions are to be required to pay tax on their financial assets where the average quarterly Romanian Interbank Offer Rate (ROBOR) exceeds the 2% threshold
The following progressive tax rates apply:
• 0.1% – if the threshold is exceeded by 0.50 percentage points
• 0.2% – if the threshold is exceeded by 0.51-1.00 percentage point
• 0.3% – if the threshold is exceeded by 1.01-1.50 percentage points
• 0.4% – if the threshold is exceeded by 1.51-2.00 percentage points
• 0.5% – if the threshold is exceeded by 2.00 percentage points
This tax is due quarterly, by the 25th day of the month following the quarter in question.
5. Reverse charge mechanism on certain local operations extended until 30 June 2022
The application of the reverse charge mechanism has been extended until 30 June 2022 for the following types of intra-community transaction:
• deliveries of cereals and industrial crops
• transfers of greenhouse gas emission certificates and green certificates
• supplies of electricity to traders
• deliveries of microprocessors, mobile phones, games consoles, tablets and laptops
6. Gross national minimum wage to increase to 2,080 RON
As of 1 January 2019, the gross national minimum wage is to increase from RON 1,900 to RON 2,080.
Moreover, employees who have completed higher education and have worked for at least one year in their field of study, the gross minimum wage is to increase from 2,080 RON to 2,350 RON.
Are you doing business in Romania? If you have questions about the recent tax changes in Romania contact our local tax experts in Romania.